Ambac Financial Group Inc (AMBC) 2023 Q4 法說會逐字稿

Greetings, and welcome to the Ambac Financial Group, Inc. fourth quarter 2023 earnings call (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to turn the call over to Charles Sebaski, Head of Investor Relations. Thank you.

您好，歡迎參加 Ambac Financial Group, Inc. 2023 年第四季財報電話會議（操作員說明） 謹此提醒，本次會議正在錄製中。現在我很高興將電話轉給投資者關係主管 Charles Sebaski。謝謝。

Good morning, and welcome to Ambac fourth quarter 2023 call to discuss financial results. Speaking today will be Claude LeBlanc, President and CEO; and David Trick, Chief Financial Officer will discuss the financial results of our business and the current market environment.

早上好，歡迎致電 Ambac 2023 年第四季討論財務業績。今天發表演說的是總裁兼執行長克勞德‧勒布朗 (Claude LeBlanc)；財務長 David Trick 將討論我們業務的財務表現和當前的市場環境。

And after prepared remarks, we'll take your questions for those of you following along on the webcast.

在準備好發言後，我們將向那些關注網路廣播的人回答您的問題。

During the prepared remarks, we'll be highlighting some slides from the investor presentation, which can be located on our website.

在準備好的發言中，我們將重點介紹投資者簡報中的一些幻燈片，這些幻燈片可以在我們的網站上找到。

Our call today includes forward looking statements. The company cautions investors that any forward-looking statement involves risks and uncertainties and is not a guarantee of future performance. Actual results may differ materially from those expressed or implied in the forward-looking statements due to a variety of factors.

我們今天的電話會議包括前瞻性陳述。該公司提醒投資者，任何前瞻性陳述都涉及風險和不確定性，並非對未來績效的保證。由於多種因素，實際結果可能與前瞻性聲明中明示或暗示的結果有重大差異。

These factors are described under the forward-looking statements in our earnings press release and our most recent 10-Q and 10-K filed with the SEC. We do not undertake any obligation to update forward-looking statements.

這些因素在我們的收益新聞稿以及我們最近向 SEC 提交的 10-Q 和 10-K 報告中的前瞻性聲明中進行了描述。我們不承擔任何更新前瞻性陳述的義務。

Also in our prepared remarks or responses to questions, we may mention some non-GAAP financial measures. Reconciliation to those non-GAAP measures are included in our recent earnings press release, operating supplement and other materials available in the Investor Relations section of our website at ambac.com. I would now like to turn the call over to Mr. Claude LeBlanc.

此外，在我們準備好的評論或對問題的答覆中，我們可能會提到一些非公認會計準則財務指標。我們最近的收益新聞稿、營運補充資料以及我們網站 ambac.com 投資者關係部分提供的其他資料中均包含這些非公認會計原則措施的調節。我現在想把電話轉給克勞德·勒布朗先生。

Thank you, Chuck, and welcome to everyone joining today's call. On a consolidated basis. For the full year 2023, we generated net income of $4 million and adjusted net income of $93 million. Book value per share stands at $30.13, up 8% from the start of the year. David will discuss our fourth quarter financial results shortly.

謝謝查克，歡迎大家參加今天的電話會議。在綜合的基礎上。2023 年全年，我們的淨利潤為 400 萬美元，調整後淨利為 9,300 萬美元。每股帳面價值為 30.13 美元，較年初成長 8%。大衛將很快討論我們第四季的財務業績。

Turning to our strategic priorities for 2023. Our focus during the year was twofold. One, scaling our Specialty P&C insurance platform, and two, progressing additional value-enhancing initiatives for our legacy financial guaranty business.

轉向我們 2023 年的策略重點。這一年我們的重點是雙重的。一是擴大我們的專業財產保險平台，二是為我們的傳統財務擔保業務推進額外的增值計劃。

With regards to our Specialty P&C insurance platform, I am pleased to report that we exceeded our strategic objectives for 2023, including generating over $0.5 billion of premium for the year, a 79% increase over 2022.

關於我們的專業財產保險平台，我很高興地報告，我們超出了 2023 年的戰略目標，包括全年產生超過 5 億美元的保費，比 2022 年增長 79%。

Our results were driven by our specialty P&C insurance franchises, Everspan and Sarafem. Each platform produced positive net income for the quarter and year in line with our projections. And while it's early days, both are on target to deliver strong results in 2024 as we look ahead to the future, we are well positioned to leverage the strong growth generated in 2023, and we believe that our specialty insurance platform is poised to deliver significant incremental value for Ambac shareholders.

我們的業績是由我們的專業財產與意外傷害保險特許經營公司 Everspan 和 Sarafem 推動的。每個平台在本季和本年度都產生了正的淨利潤，符合我們的預測。雖然現在還處於早期階段，但隨著我們展望未來，兩者的目標都是在2024 年實現強勁業績，我們已做好充分準備，利用2023 年的強勁增長，並且我們相信我們的專業保險平台將帶來顯著的業績成長為 Ambac 股東帶來增量價值。

Our vision is to create the premier destination for MGA and program operators, and I believe we have built a strong foundation to deliver on that goal. The entry program market remains attractive to us for a number of reasons.

我們的願景是為 MGA 和專案營運商打造首選目的地，我相信我們已經為實現這一目標奠定了堅實的基礎。由於多種原因，入門計劃市場對我們仍然具有吸引力。

Firstly, the MGA market has nearly doubled in size over the last five years, meaningfully outgrowing the P&C market at large forecasts predict the specialty market to nearly double in size, again to $160 billion by 2030.

首先，MGA 市場的規模在過去五年中幾乎翻了一番，大大超過了財產與意外險市場的成長，預計專業市場的規模將成長近一倍，到 2030 年再次達到 1,600 億美元。

Secondly, MGAs are more aligned with the E&S market, which has been generating superior underwriting results compared to the standard P&C market. The E&S markets loss ratio has diverged from the standard market in each year since 2020 and in 2022 E&S posted a 91% combined ratio, which was 12% lower than the standard market.

其次，MGA 與 E&S 市場更一致，與標準 P&C 市場相比，E&S 市場一直在產生卓越的承保績效。自 2020 年以來，E&S 市場的損失率每年都與標準市場有差異，2022 年 E&S 的綜合損失率為 91%，比標準市場低 12%。

Lastly, and most importantly, these strong results point towards what we view as a secular shift towards specialization within the insurance industry. As the risk landscape becomes more complex, our P&C franchise is well equipped to effectively underwrite and support specialized risks, Ambac's differentiated offering addresses distribution and risk assumption needs in the following ways we provide capital, whether it is risk capital in the form of a rated balance sheet at Everspan or growth capital as a portfolio company under Serada, we provider MGAs and program partners with leading risk and oversight controls. We facilitate reinsurance or MGAs and program partners.

最後也是最重要的是，這些強勁的結果顯示我們認為保險業正在向專業化方向長期轉變。隨著風險情勢變得更加複雜，我們的財產與意外傷害專營權有能力有效承保和支持專門風險，Ambac 的差異化產品透過我們提供資本的以下方式滿足分配和風險承擔需求，無論是評級形式的創投作為 Serada 旗下投資組合公司 Everspan 或 Growth Capital 的資產負債表，我們為 MGA 和專案合作夥伴提供領先的風險和監督控制。我們為再保險或 MGA 以及專案合作夥伴提供便利。

We support our partners with the broad technology focus, shared service offerings, and we provide partners with business agility solutions to rapidly react to changing business or market conditions.

我們透過廣泛的技術重點、共享服務產品為合作夥伴提供支持，並為合作夥伴提供業務敏捷性解決方案，以快速應對不斷變化的業務或市場條件。

As we laid out last quarter, we now forecast our P&C business, Everspan and Serada generate on a combined basis over [$700 million] of premium production in 2024 setting aside any future acquisitions that implies growth of over 40% from 2023 while maintaining very attractive margins.

正如我們上季度所闡述的那樣，我們現在預測我們的財產保險業務、Everspan 和Serada 到2024 年將產生超過[7 億美元] 的優質產量，不考慮未來的收購，這意味著從2023 年開始成長超過40%，同時保持非常有吸引力的水平邊距。

Turning now to our Spanish results for 2023, Everspan had a very strong year generating gross premium written of $273 million, which is up 87% over 2022. The business continues to diversify its program partners, which currently stand at 23, up from 14 programs a year ago and includes among other classes, commercial auto, excess liabilities, workers' comp and general liability programs.

現在看看我們在西班牙的 2023 年業績，Everspan 的表現非常強勁，毛保費達到 2.73 億美元，比 2022 年增長了 87%。該業務繼續使其計劃合作夥伴多元化，目前合作夥伴數量已從一年前的 14 個增加到 23 個，其中包括商用汽車、超額負債、工人補償和一般責任計劃等類別。

Overall response book is more balanced across risk classes, which should have the long-term benefit of more stable and predictable underwriting ourselves following its launch in 2021, Everspan has now achieved the necessary scale to start generating underwriting profits reporting a 100% combined ratio for the fourth quarter, the fifth consecutive quarterly improvement. We are now on a pathway to generating mid-teen ROEs at scale over the cycle Serada had similarly strong performance in 2023, generating $231 million of premium, up 70% over the prior period, while producing over $11 million of EBITDA, supported by the ongoing benefit of organic growth initiatives and the financial performance of last year's acquisitions. After onboarding three partners over the last 15 months, we now operate four programs at Serada across various classes of business, including specialty, commercial, auto, professional liability, Inland Marine, employer stop-loss and affinity programs. We continues to see significant opportunities for growth at Serada, whether via product expansion across our current businesses or through additional M&A transactions.

整體反應帳簿在不同風險類別之間更加平衡，這應該會帶來長期好處，即自2021 年推出以來，我們自己的承保更加穩定和可預測，Everspan 目前已達到必要的規模，可以開始產生承保利潤，報告的綜合比率為100%第四季度，連續第五個季度出現改善。我們現在正走在整個週期內大規模產生中青少年ROE 的道路上。Serada 在2023 年也有同樣強勁的表現，產生了2.31 億美元的溢價，比上一時期增長了70%，同時產生了超過1100萬美元的EBITDA，得益於有機成長計畫和去年收購的財務表現的持續效益。在過去 15 個月內招募了三位合作夥伴後，我們現在在 Serada 經營四個涉及不同業務類別的計劃，包括專業、商業、汽車、專業責任、內陸海事、雇主止損和親和計劃。我們繼續看到 Serada 的重大成長機會，無論是透過我們目前業務的產品擴展還是透過額外的併購交易。

Having a seeded our 2023 targets of $200 million of place, Permian, $45 million of gross revenue with in excess of 20% EBITDA margins. We now have our sights set on our 2024 business plan forecasting over $300 million of premium and $60 million of gross revenue while maintaining our plus 20% EBITDA margins. These figures exclude potential M&A opportunities, which could materially and favorably impact our results.

我們的 2023 年目標是二疊紀盆地總收入 2 億美元，4,500 萬美元，EBITDA 利潤率超過 20%。我們現在的目標是 2024 年業務計劃，預測保費將超過 3 億美元，總收入將超過 6,000 萬美元，同時維持 20% 以上的 EBITDA 利潤率。這些數字不包括潛在的併購機會，這可能會對我們的業績產生重大和有利的影響。

Regarding the legacy financial guaranty business late last week, the OCI finalize a cease new stipulation and order, which includes the OCI. capital model, which provides us with a new regulatory framework and clarity on the capital requirements at ACC.

關於上週稍後遺留的財務擔保業務，OCI 敲定了一項停止新規定和命令，其中包括 OCI。資本模型，為我們提供了新的監管框架，並明確了 ACC 的資本要求。

In addition, the assessment of strategic options for this business, which we announced last quarter is progressing as planned, and we look forward to updating the market once there's something definitive to report in advancing the preparation for our strategic review.

此外，我們上季度宣布的對該業務戰略選擇的評估正在按計劃進行，一旦有明確的報告可以推動我們的戰略審查的準備工作，我們期待著向市場提供最新信息。

In 2023, we continued to improve the quality of the insured portfolio through various de-risking initiatives, which for the full year saw net par outstanding reduced by 14% and adversely classified credits reduced by 26%.

2023年，我們透過各種去風險措施繼續提高受保投資組合的質量，全年未償淨面值減少了14%，不利分類信貸減少了26%。

And I will now turn the call over to David to discuss our financial results for the quarter.

我現在將把電話轉給大衛，討論我們本季的財務表現。

David?

大衛？

Thank you, Claude, and good morning, everyone. For the first quarter of 2023, Ambac reported a net loss of $16 million or $0.24 per diluted share compared to net income of $175 million, or $3.86 per diluted share in the fourth quarter of 2022, adjusted net income was $10 million or $0.32 per diluted share compared to adjusted net income of $183 million or $4.3 per diluted share in the fourth quarter of 2022.

謝謝克勞德，大家早安。2023 年第一季度，Ambac 報告淨虧損1,600 萬美元，即稀釋後每股0.24 美元，而2022 年第四季淨利為1.75 億美元，即稀釋後每股3.86 美元，調整後淨利潤為1,000 萬美元，即稀釋後每股0.32 美元相比之下，2022 年第四季調整後淨利為 1.83 億美元，即稀釋後每股收益 4.3 美元。

The change in net income and adjusted net income was mainly driven by a $193 million of gains related to the Bank of America and the more RMBS litigation settlements recognized in the fourth quarter of 2022. And they do of expanded net premiums written in the quarter for $37 million were up 269% over the prior year period. Growth in existing programs and the addition of new programs including assumed reinsurance programs accounted for the significant advance.

淨利潤和調整後淨利潤的變化主要是由與美國銀行相關的 1.93 億美元收益以及 2022 年第四季度確認的更多 RMBS 訴訟和解推動的。他們在該季度的擴大淨保費為 3,700 萬美元，比去年同期成長了 269%。現有計劃的成長和新計劃（包括假定的再保險計劃）的增加是這一重大進展的原因。

Our expense retention rate was approximately 40% of gross premium compared to 19% last year to increase retention level stem mostly from workers' compensation in nonstandard auto programs written in the third and fourth quarters, respectively.

我們的費用保留率約為毛保費的 40%，而去年為 19%，保留水準的提高主要源自於分別在第三季和第四季制定的非標準汽車計畫中的工人賠償。

As assumed reinsurance earned premiums and program fees are $25 million and $2.5 million, up 341% and 77%, respectively, from the fourth quarter of 2022. The loss ratio of 67.4% in the fourth quarter of 2023 was up from 65.1% last year.

假設再保險所賺取的保費和計畫費用分別為 2,500 萬美元和 250 萬美元，較 2022 年第四季分別成長 341% 和 77%。2023年第四季虧損率為67.4%，高於去年的65.1%。

The increase was primarily driven by higher commercial auto liability claim frequency in 2023 for the full year 2023, the loss ratio was 70.7% compared to 65.4% for 2022 the increase for 2023 entirely related to the 2023 losses, particularly commercial auto liability frequency, as previously noted, as well as the addition of the assumed nonstandard auto program. So several of our programs benefit from a sliding scale commission structure, which helps moderate loss activity within certain ranges.

這一增長主要是由於 2023 年全年商業汽車責任索賠頻率較高，損失率為 70.7%，而 2022 年為 65.4%，2023 年的增長完全與 2023 年損失有關，特別是商業汽車責任頻率，因為前面提到過，以及增加了假定的非標準自動程序。因此，我們的幾個項目受益於浮動佣金結構，這有助於將損失活動控制在一定範圍內。

The fourth quarter and full year of 2023 through sliding scale benefit recorded through acquisition cost was 1.2% and 3.2% respectively. Our loss ratios net of the sliding scale benefit for 66.2% and 67.5%, respectively. Expense ratio was 32.9% in the fourth quarter of 2023, down from 59.2% in the prior year quarter was driven lower, mostly due to the scaling of the business combined ratio of fourth quarter 2023.

2023 年第四季和全年透過收購成本記錄的滑動效益分別為 1.2% 和 3.2%。扣除滑動比例收益後，我們的損失率分別為 66.2% 和 67.5%。2023 年第四季的費用率為 32.9%，低於去年同期的 59.2%，主要是由於 2023 年第四季業務綜合成本率的擴大所致。

Full year 2023 was 100.3% and 106.5%, respectively, an improvement of 24-percentage-points and 50-percentage-points from their respective prior periods. For the quarter, average spend generated just over a $1 million pretax profit compared to a loss of less than $1 million for the fourth quarter of 2022.

2023 年全年分別為 100.3% 和 106.5%，分別比前期增加 24 個百分點和 50 個百分點。該季度的平均支出產生了略高於 100 萬美元的稅前利潤，而 2022 年第四季的虧損則不足 100 萬美元。

Average balance profitable for full year 2023. Our spend continues to see and evaluate a steady stream of submitted submissions for remains highly selective and focused on maintaining underwriting profitability. We continue to expect our spend to generate a mid single digit ROE in 2024.

2023 年全年平均獲利餘額。我們的支出將繼續查看和評估源源不斷的提交資料，以保持高度選擇性並專注於維持承保盈利能力。我們仍然預期 2024 年我們的支出將產生中等個位數的 ROE。

Serada, our insurance distribution platform, we generated revenue of $12 million in the fourth quarter, up 38% compared to the fourth quarter of 2022, benefiting from both recent acquisitions and organic growth. The insurance distribution segment produced nearly $2 million of EBITDA for the fourth quarter, down slightly from the fourth quarter of 2022 EBITDA margin of 14.3% this quarter compared to 23.2% last year.

我們的保險分銷平台 Serada 在第四季度創造了 1,200 萬美元的收入，比 2022 年第四季成長了 38%，受益於最近的收購和有機成長。保險分銷部門第四季度產生了近 200 萬美元的 EBITDA，略低於 2022 年第四季的 EBITDA 利潤率 14.3%，而去年為 23.2%。

The margin contraction was larger, largely driven by the impact of recent acquisitions from business mix shift during the quarter and expenses related to organic growth initiatives and integration costs. It's worth noting that the fourth quarter is a seasonally light quarter for the segment that Ratos full year margin of 22.3% is on plan and in line with our 20%-plus margin expectation for 2024.

利潤率收縮幅度更大，主要是由於本季度業務組合轉變導致的近期收購的影響以及與有機增長計劃和整合成本相關的費用。值得注意的是，第四季度是該領域季節性淡季，Ratos 全年利潤率為 22.3%，符合計劃，符合我們對 2024 年 20% 以上的利潤率預期。

For the fourth quarter the legacy financial guaranty segment generated a net loss of $12 million versus net income of $180 million in the prior year period. The year-over-year change was primarily driven by the previously mentioned net gain related to RMBS litigation settlements in the prior quarter.

第四季度，遺留財務擔保部門淨虧損 1,200 萬美元，而上年同期淨利為 1.8 億美元。同比變化主要是由前面提到的上一季與 RMBS 訴訟和解相關的淨收益所推動的。

Consolidated investment income for the fourth quarter was $40 million compared to $23 million in the fourth quarter of 2022 improvement stemmed from higher average yield on fixed income securities, which increased nearly 90 basis points in the fourth quarter of 2023 compared to last year, supplementing the yield generated by our core fixed income portfolio with a $10 million increase in alternative investments compared to the fourth quarter of 2022.

第四季綜合投資收入為4,000 萬美元，而2022 年第四季為2,300 萬美元，這一改善源於固定收益證券平均收益率的提高，2023 年第四季與去年相比增加了近90 個基點，補充了固定收益證券的平均收益率。與 2022 年第四季相比，我們的核心固定收益投資組合產生的收益增加了 1,000 萬美元，另類投資增加了 1,000 萬美元。

Separately, during the fourth quarter, we realized a $12 million, to sell charge on owned AAC insured student loan bonds related to our recently completed commutation and the associated insured obligations.

另外，在第四季度，我們實現了 1200 萬美元的銷售費用，用於出售與我們最近完成的減刑和相關保險義務相關的 AAC 保險學生貸款債券。

Consolidated loss and loss adjustment expenses were $19 million in the fourth quarter of 2023 compared to a $55 million benefit in the fourth quarter of 2022. Spend losses grew by $13 million compared to the prior year to $17 million, in line with this larger earned premium base.

2023 年第四季的合併損失和損失調整費用為 1,900 萬美元，而 2022 年第四季的收益為 5,500 萬美元。與前一年相比，支出損失增加了 1,300 萬美元，達到 1,700 萬美元，與這一較大的已賺保費基數相符。

Legacy financial guaranty losses of $2 million favorably impacted by a benefit from student loan commutation and high RMBS recoveries, but adversely impacted by lower discount rates comparison, legacy financial guaranty losses and benefited from a $43 million gain from the Nomura settlement during the fourth quarter of 2022.

200 萬美元的遺留財務擔保損失受到學生貸款減免和高 RMBS 回收的有利影響，但受到較低貼現率比較、遺留財務擔保損失以及野村證券和解中 4300 萬美元收益的不利影響。2022 年。

General and administrative expenses were $35 million for the fourth quarter, down from $51 million in the fourth quarter of 2022. The improvement in operating expenses was largely due to over $20 million of reduced defensive litigation and other non-compensation costs at AC. compared to the fourth quarter of 2022. These savings were partially offset by growth in our P&C businesses.

第四季一般及管理費用為 3,500 萬美元，低於 2022 年第四季的 5,100 萬美元。營運支出的改善主要是由於 AC 的辯護訴訟和其他非補償成本減少了超過 2000 萬美元。與 2022 年第四季相比。這些節省金額被我們財產與意外傷害業務的成長部分抵銷。

Performance compensation adjusts interest expense was approximately $16 million, down from $30 million in the fourth quarter of 2022, following the significant deleveraging of ACACs remaining surplus note debt as of December 31, 2023 was $994 million, inclusive of accrued and unpaid interest.

績效薪酬調整後的利息支出約為1,600 萬美元，低於2022 年第四季的3,000 萬美元，此前ACAC 進行了大幅去槓桿化，截至2023 年12 月31 日，剩餘盈餘票據債務為9.94 億美元，包括應計和未付利息。

As it relates to the balance sheet, shareholders' equity of $1.36 billion for $30.13 per share at December 31, 2023 was up from $28 per share at September 30, 2023. The increase was driven by a $69 million increase to unrealized gains on available for sale investments. Foreign exchange translation gains related to a UK of $32 million, somewhat offset by the $16 million net loss in the quarter.

與資產負債表相關，截至 2023 年 12 月 31 日，股東權益為 13.6 億美元，每股 30.13 美元，高於 2023 年 9 月 30 日的每股 28 美元。這一增長是由於可供出售投資的未實現收益增加了 6,900 萬美元。與英國相關的外匯換算收益為 3,200 萬美元，在一定程度上被本季 1,600 萬美元的淨虧損所抵銷。

Adjusted book value of $1.3 billion for $28.74 per share at December 31, 2023, it was up over 3% from $27.90 per share at September 30, 2023. At December 31, 2023 AFG on a stand-alone basis, excluding investments in subsidiaries had cash and investments and net receivables of approximately $211 million or $4.68 per share. I will now turn the call back to Claude for some brief closing remarks.

截至 2023 年 12 月 31 日，調整後帳面價值為 13 億美元，每股 28.74 美元，較 2023 年 9 月 30 日的每股 27.90 美元增長超過 3%。截至 2023 年 12 月 31 日，AFG 的獨立基礎上（不包括對子公司的投資）的現金、投資和應收帳款淨額約為 2.11 億美元或每股 4.68 美元。現在我將把電話轉回給克勞德，讓他發表一些簡短的結論。

Thank you, David. I am very excited about our prospects for 2024 for our Specialty P&C insurance business. We remain focused on delivering strong earnings growth in coming periods. Our three year plan aims to scale our Permian production to over $1.5 billion with over $100 million of EBITDA on a combined basis from Everspan and Serada.

謝謝你，大衛。我對 2024 年專業財產保險業務的前景感到非常興奮。我們仍然專注於在未來幾個時期實現強勁的獲利成長。我們的三年計畫旨在將二疊紀產量擴大到 15 億美元以上，Everspan 和 Serada 的 EBITDA 合計超過 1 億美元。

We are well positioned to meet our goals with the strong foundation we have built and leadership talent. We continue to attract. We are also laser focused on progressing the legacy business strategic review process launched in December, and we will update you when we have more information to share 2024 is positioned to be a year of transformational change for Ambac, and I look forward to updating you on our progress in the coming quarters. Please open the call for questions.

憑藉我們已建立的堅實基礎和領導人才，我們有能力實現我們的目標。我們繼續吸引。我們也專注於推進12 月啟動的遺留業務策略審查流程，當我們有更多資訊可供分享時，我們將向您通報最新情況2024 年將是Ambac 轉型變革的一年，我期待向您通報最新情況我們在未來幾季的進展。請打開電話提問。

(Operator Instructions) Dennis Chua, Repertoire Partners.

（操作員說明）Dennis Chua，Repertoire Partners。

Hey Claude congrats on the great quarter and great execution on both the legacy business on the P&C businesses on. And I think we weren't expecting an update on the AC. review, but I'm looking forward to that fund.

嘿，克勞德祝賀財產與意外傷害業務的傳統業務取得了出色的季度業績和出色的執行力。我認為我們並沒有期待 AC 的更新。審查，但我很期待該基金。

The OCI. process sounds like the capital model framework or the capital model itself is finalized. And maybe help us think about whether the OCI. approved contingency reserve release at AC. has any impact on thinking about distributions from AC?

OCI。這個過程聽起來像是資本模型框架或資本模型本身已經最終確定。也許可以幫助我們思考 OCI 是否有效。批准在 AC 釋放應急儲備。對思考 AC 的分佈有什麼影響？

Thanks, Dennis. Our I'll pass that one over to David.

謝謝，丹尼斯。我會把那個轉給大衛。

Dennis, thanks for your question. So the impact of the contingency reserves really is not on the capital model. So the capital model is it's quite comprehensive and factored in those contingency reserves as part of the capital structure of a C, I think the contingency reserve release for us, there's a couple of things that help progress the cleanup of the balance sheet at AC.

丹尼斯，謝謝你的問題。所以應急準備金的影響其實並不是對資本模型的影響。因此，資本模型是相當全面的，並且將這些應急準備金作為C 資本結構的一部分考慮在內，我認為應急準備金的釋放對我們來說，有幾件事有助於推進AC 資產負債表的清理。

It also is indicative of, I believe, our recognition OCR recognition of the derisking of AC.'s balance sheet. So I think your partner puts us in a little simpler position from a understanding of our statutory statements. And also we also don't expect to be contributing. And two additional contingency were reserves in the future. So overall, I think it's a positive for us, but it was has been factored into the OCI. contingency up a capital models that doesn't have a direct impact on distributions in the short term.

我相信，這也顯示我們對 OCR 認可 AC. 資產負債表去風險的認可。因此，我認為您的合作夥伴透過理解我們的法定聲明使我們處於更簡單的位置。而且我們也不期望能做出貢獻。另外兩個應急措施是未來的儲備。總的來說，我認為這對我們來說是積極的，但它已被納入 OCI 中。應急資本模型不會在短期內對分配產生直接影響。

(Operator Instructions) Thank you. There are no further questions at this time.

（操作員說明）謝謝。目前沒有其他問題。

This concludes today's teleconference. We thank you for your participation. You may disconnect your lines at this time.

今天的電話會議到此結束。我們感謝您的參與。此時您可以斷開線路。